(Bloomberg) — Colombia’s government will bypass Congress and take the unprecedented step of issuing its 2025 budget by decree.
The government of President Gustavo Petro made the decision after failing to reach an agreement with lawmakers on spending cuts and tax increases, Lower House Rep. Eliecer Salazar, a government ally who also heads a congressional economics committee, said Tuesday.
According to Juan Felipe Lemos, an opposition senator, the unconventional use of presidential powers is likely to be challenged in the Constitutional Court, which could potentially reject the budget, leaving it unchanged from 2024.
Petro will unveil a 523 trillion peso ($126 billion) budget next year, ignoring opposition from a majority of congressmen who have demanded lower spending.
The government’s desire to raise taxes to finance a 12 trillion peso deficit has led to a clash with opposition figures, who argued the economy was too weak to support the higher levies.
Weak economic growth has led to lower-than-expected tax revenues, undermining the government’s fiscal position. The Finance Ministry had already cut the 2024 budget by 20 trillion pesos earlier this year.
Most read from Bloomberg Businessweek
©2024 Bloomberg LP
